Tax Issues

FAQ on Clergy Housing Allowance case

Update: Dec. 18, 2017

On Oct. 6, 2017 U.S. District Judge Barbara B. Crabb of the Western District of Wisconsin found that 26 U.S.C. § 107(2) violates the establishment clause of the First Amendment to the United States Constitution. At that time, there were still two issues to be decided, the remedy and whether or not the decision would be stayed pending any potential appeals.

Judge Crabb issued an order on Dec. 13, 2017 addressing these two issues. She enjoined the IRS from enforcing section 107(2), which is the section permitting a housing allowance for ministers of the gospel, but she stayed the injunction until 180 days after either the conclusion of any pending appeals or the failure to file an appeal by a party. This means that the clergy housing allowance is still available while any appeals are pending. We will keep you updated on the appeals process.